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Sent: Wednesday, June 25, 2003 9:55 AM
Subject: Alternatives to address public shareholder interests
I've invited Crowley Maritime's CEO to discuss
his views of shareholder interests with me, as indicated in letter copied
below.
You'll see that I've stated my assumption that
both the controlling family shareholders and the minority public
shareholders would be better off if the company either commits itself to
operating like a public company or, alternatively, buys out the public
shareholders so that it can operate effectively as a private company.
I hope Mr. Crowley will be interested in my
suggested cooperative explorations of alternatives. However, if he isn't,
I believe it will be possible to structure something independently of
company decisions that will provide shareholders with the kind of
information access and liquidity needed for a publicly traded security.
In either case, I'll want to be familiar with
all the issues that may concern public shareholders. The letter refers to
a couple of obvious examples (splitting the stock and listing it). I'm
aware of others, such as the use of corporate funds to pay for insurance
policies which management bluntly admits are intended to benefit family
shareholders by paying their taxes and preserving their control. (See
pages 36-37 of the company's most recent 10K report.) Please tell me
what else should be on the list, even if it's relatively minor.
GL - 6/25/03
Gary Lutin
Lutin & Company
575 Madison Avenue, 10th Floor
New York, New York 10022
(Tel: 212/605-0335)
(Fax: 212/605-0325)
[letterhead]
LUTIN & COMPANY
575 Madison Avenue
New York, New York 10022
Telephone (212) 605-0335
Facsimile (212) 605-0325
June 24, 2003
By telecopier:
510/251-7601
Mr. Thomas B. Crowley, Jr.
Crowley Maritime Corporation
155 Grand Avenue
Oakland, California 94612
Dear Mr. Crowley:
As indicated in Friday's
telephone message, I'd welcome an opportunity to talk with you
informally about your views concerning the interests of Crowley
Maritime's public shareholders. I would of course be pleased to meet
with you if a visit can be scheduled while you're in New York this week.
My preliminary impressions
of your company's situation suggest that shareholder value could be
significantly enhanced by adopting practices conventionally followed by
publicly traded companies to accommodate their investors. For example,
even very simple steps such as splitting the stock and listing it would
have a meaningful effect on the liquidity and value of the investment.
Alternatively, considering your management's stated preference for
non-public ownership, both the controlling and minority shareholders
might achieve their objectives from a fairly structured transaction to
take the company private.
Either alternative would
seem clearly better than the current "worst of both worlds" conditions,
and would allow management to focus on the vigorous development of your
company's business operations for the benefit of whichever set of owners
you choose. And, addressing the purpose of my suggested discussions,
it's also reasonable to assume that either alternative could defined
most effectively through cooperative communication.
Sincerely yours,
Gary Lutin
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